Mastitis is one of the most important diseases in dairy cows throughout the world and is responsible for significant economic losses to the dairy industry. This study was performed to characterize the genetic basis of drug resistance in Escherichia coli isolated from cases of clinical and sub-clinical bovine mastitis. A total of 224 California mastitis test (CMT)-positive milk samples were collected from December 2015 to April 2016 to characterize the phenotypic and genetic basis of antimicrobial resistance in E. coli isolated from raw milk from dairy farms found in Burayu, Sebeta, and Holeta areas of Ethiopia. The prevalence of E. coli was 7.1% (16) and both phenotypic and molecular techniques were used to identify E. coli antimicrobial susceptibility trait. The most commonly observed phenotypic resistance was against ampicillin (68.7%), sulphamethazole-trimethoprim (50%), and streptomycin (25%). Multidrug resistance phenotypes were found in 11 of 16 (68.7%) of E. coli isolates. Tetracycline (tet (A)) and chloramphenicol (cml (A)) genes were the most predominant encoding resistance genes identified (50%) each, followed by gentamycin resistance encoding gene (aac (3)-IV) (37.5%). Overall, 11 (68.7%) of the isolates had multidrug resistance genes responsible to two or more classes of antibiotics. The most common pattern detected was cml (A) and tet (A) together 37.5% followed by aac (3)-IV and tet (A) 25%. The current study indicated that raw milk could be regarded as critical source of antibiotic-resistant pathogenic E. coli.